GKN is continuing to expand in China with the announcement of a new automotive manufacturing facility and a new joint venture.

The two announcements follow GKN's recent acquisition of a local manufacturer of wheels for the off-highway sector.

GKN Driveline Torque Technology will establish a new manufacturing facility in Shanghai's Kangqiao development zone, with an initial investment of RMB34m (GBP2.25m).

A GKN spokesman said: "We are experiencing rapid growth in demand for our torque technology products in China."

The new facility will manufacture a range of geared components at Kangqiao, including differentials, final drive and power transfer units and advanced torque management devices as market demand for these products matures. Initial production will start this year.

GKN Driveline also has exchanged contracts to form a new driveshaft manufacturing joint venture, GKN Driveshaft (Chongqing) (GDC) in Chongqing, central China to supply China South Industries Motor Company (CSIMC), the country's third largest OEM.

A 50-50joint venture, Shanghai GKN Drive Shaft (SDS) owns 51% of GDC and will consolidate its financial results. The remaining shareholders are CSIMC with 40% and GKN Driveline with 9% directly. Together with its direct and indirect shareholding in SDS, GKN Driveline owns 34.5% of GDC.

By forming GDC, the components maker say it will ensure it remains close to CSIMC's key OEMs which include its 50% owned ChangAn Ford and 51% ChangAn Suzuki passenger car manufacturers as well as its 100% owned in-house brand, Chana.

GKN Driveline's existing 50% owned driveshaft operations, based in Shanghai and Jilin, will remain independent of GDC and will supply components to GDC.

GDC is forecast to employ 155 people. The capital investment will be approximately EUR9m, funded locally. Total investment in registered capital is RMB 50m or 4.8m Euro, of which GKN Driveline's direct 9% share is 0.4m Euro. SDS and GKN Driveline will fund their investments through current cash resources.

GKN has operated in China for 18 years and currently employs some 2,800 people in its various operations.